Hebrew University patent company Yissum enjoys record revenues, royalties in 2004
Novartis' drug Exelon, with annual sales of $420 million, Johnson & Johnson's Doxil, and Daniella cherry tomatoes were the main sources of income for Hebrew University's commercial patent company, Yissum Research Development, in 2004.
Revenues from royalties reached a record NIS 160 million ($36 million), up 11 percent over 2003, but still lower than that forecasted revenues of $40 million.
Yissum's income from royalties comes from business partnerships formed with industrial companies, whereby technologies developed at the university's laboratories are given to companies in exchange for a share of revenues stemming from the sale of products developed using those technologies.
The university's researchers receive 40 percent of the royalties from registered patents resulting from their research, and 20 percent of the revenues usually applied to research grants for their labs. The rest of the money is divided between Yissum and Hebrew U. Last year, these revenues were based mainly on the expectations for success of clinical trials conducted by Pharmos, in which Yissum is a shareholder. Unfortunately, those trials failed.
Yissum's revenues do not include the university's income from payments for the use of the name or image of Albert Einstein, who bequeathed the rights to his name, image and research to the university.
These revenues also do not include yields on old investments, including profits from library software vendor Ex Libris.
Yissum now ranks second in commercial profit earnings among Israel's academic institutions, behind the Weizmann Institute of Science's company, Yeda Research and Development, whose annual revenues have topped
$90 million in recent years. Yeda is among the most profitable companies in the world in patent royalty revenues thanks to drugs such as Copaxone and Rebif, which were developed by institute researchers.
Yissum's main source of revenue will be threatened in the next few years, when Exelon becomes a generic drug. To counterbalance this expected loss, the university hopes to increase its revenues from start-up companies in which it has invested, including the advanced automotive technology company, Mobileye, which is planning its first public stock offering this coming year.
A few of Yissum's subsidiaries have had impressive rounds of capital raising as of late: Chiasma is in the process of raising $5 million, Novagali raised 14.2 million euros this past year; HumanEyes attracted $5 million in investments; TargetIN raised $500,000, and SyndromeX raised $1 million and hoping to raise another $1 million soon.
Yissum CEO Avi Barak said the company has registered about 90 patents this year for university researchers, and several projects are currently under way that are expected to yield profits in the next few years. Barak noted that the company's revenues have been growing by about 10 percent each year. Yissum last year invested over NIS 10 million in registering and protecting patents, a prerequisite for transfering technology from academia to industry.
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